COP26 has begun with a major declaration from some of the world’s most biodiverse countries, including Brazil, Russia and the Democratic Republic of the Congo, to end deforestation by 2030. If respected, the Declaration on Forests and Land Use will prevent the loss of some of the world’s most important carbon sinks and last remaining centres of plant and animal life. This pledge underlines the fact that climate change cannot be addressed without protecting the world’s biodiversity, and that biodiversity cannot be safeguarded without clear action on climate change.

Currently underway in Glasgow, COP26 has been organised under the United Nations Framework Convention on Climate Change. Next year, another Conference of Parties, COP15, organised under the Convention on Biological Diversity will be dedicated to protecting biodiversity. In the first virtual phase of COP15, the Kunming Declaration was issued in October 2021. The Declaration lays down a commitment to reverse biodiversity loss and bring about a new ecological civilisation with a shared future for all life on earth. Yesterday’s announcement on deforestation substantively links the work of these two international COPs and highlights how action has now become imperative in all aspects of ecological protection.

Tuesday at COP26 also saw the world’s leading multilateral development banks, encompassing institutions from Europe, the Americas, Africa and Asia, combine to issue a joint statement on climate change and biodiversity entitled Nature, People and Planet. Representatives of these institutions have committed to not only aligning their own extensive portfolios with the Paris Agreement goals, but also to ensuring that their work is aligned with nature. In practice this includes ensuring their portfolios and supply chains exclude practice and products linked to deforestation.

Indeed, protecting the world’s natural assets is of increasing interest to the financial sector. To catalyse private sector action in this area, the Intrinsic Exchange Group, alongside the New York Stock Exchange, has established a new asset class, Natural Asset Companies (NACs), which will be listed and traded on the exchange but will work to provide funding for the protection of the natural assets they represent. Listed NACs therefore turn natural ecosystems from a cost to manage into a productive asset and store of wealth. Innovative financial products have the potential to incorporate nature-based solutions into the market economy and incentivise a reassessment of the value of our environment.

So far, COP26 has shown that climate change and biodiversity cannot be addressed separately. These commitments made in Glasgow reflect a novel and innovative approach by governments and institutions to tackling climate change while safeguarding our environment.